nep-agr New Economics Papers
on Agricultural Economics
Issue of 2019‒07‒15
fourteen papers chosen by

  1. India’s Agrarian Performance: A Comparative Analysis of UPA and NDA Regimes By Sthanu R. Nair
  2. Analysis of long-term challenges for agricultural markets By John T. Saunders; Marcel Adenauer; Jonathan Brooks
  3. Cows, cash and climate: Low stocking rates, high-performing cows, emissions and profitability across New Zealand farms By Fleming, David; Kerr, Suzi; Lou, Edmund
  4. Rising Market Concentration and the Decline of Food Price Shock Pass-Through to Core Inflation By Brown, Jason; Tousey, Colton
  5. How do agro-pastoral policies affect the dietary intake of agro-pastoralists in Niger? By Christophe Muller; Nouréini Sayouti
  6. Corporate Social Responsibility and the role of Rural Women in Sustainable Agricultural Development in sub-Saharan Africa: Evidence from the Niger Delta in Nigeria By Joseph I. Uduji; Elda N. Okolo-Obasi; Simplice A. Asongu
  7. Does A Market Systems Approach Revitalize Smallholder Irrigation Schemes? Evidence from Zimbabwe By Masasi, Blessing; Ng’ombe, John N.
  8. Drought and Property Prices: Empirical Evidence from Iran By Mohammad Reza Farzanegan; Mehdi Feizi; Hassan F. Gholipour
  9. Who owns the land? Social relations and conflict over resources in Africa By Berry, Sara S.
  10. Anglers' views on conservation of sea bass By Grilli, Gianluca; Curtis, John; Hynes, Stephen; O'Reilly, Paul
  11. Land-use modelling in New Zealand: current practice and future needs By Hendy, Jo; Ausseil, Anne-Gaelle; Bain, Isaac; Blanc, Elodie; Fleming, David; Gibbs, Joel; Hall, Alistar; Herzig, Alexander; Kavanagh, Patrick; Kerr, Suzi; Leining, Catherine; Leroy, Laetitia; Lou, Edmund; Monge, Juan; Reisinger, Andy; Risk, Jim; Soliman, Tarek; Stroombergen, Adolf; Timar, Levente; van der Weerdan, Tomy; White, Dominic; Zammit, Christian
  12. Links between maternal employment and child nutrition in rural Tanzania By Debela, Bethelhem Legesse; Gehrke, Esther; Qaim, Matin
  13. Impacts of Agricultural Price Support Policies on Price Variability and Welfare: Evidence from China’s Soybean Market By Wenting Wang; Longbao Wei
  14. Can the Tripartite Rubber Council manipulate international rubber prices? By Kopp, Thomas; Dalheimer, Bernhard; Alamsyah, Zulkifli; Yanita, Mirawati; Brümmer, Bernhard

  1. By: Sthanu R. Nair (Indian Institute of Management Kozhikode)
    Abstract: The performance of India’s agrarian economy under the National Democratic Alliance (NDA)-II government has been a subject of intense public debate in the last few years.Yet, a detailed study on the subject is not available. The objective of this article is to examine the overall performance of the Indian agriculture sector during the NDA-II regime compared to the United Progressive Alliance (UPA) regime. It is found that, contrary to popular perception, the Indian agriculture sector performed pretty well during the NDA-II regime. Despite the poor climatic conditions, the growth of agricultural gross value added was equivalent to the targeted long-term growth rate of 4 percentin the NDA-II regime.The growth of production of food commodities such as cereals, pulses, oilseeds, tea, milk, egg,and fish was higher in the NDA-II regime compared to the whole UPA regime.In contrast, production of sugarcane, cotton, coffee, vegetables, fruits,and meat grew at a lower rate during the NDA-II regime.Importantly, there are clear signs of diversification of food production towards high-value agricultural commodities during the NDA-II regime.There was an improvement in the productivity of cereals,pulses, oilseeds, tea,and sugarcane.The MSP of the majority of the farm products grew at a lower rate during the NDA-II regime compared to the UPA regime.Though this might have hurt the farmers and has triggered farmers’agitation, it helped to reduce the food price inflation to a significant extent compared to the UPA regime. The efficiency of agricultural credit in promoting agricultural growth has come down significantly over the yearsincluding the NDA-II regime.Thisimplies that agricultural growth during the NDA-II regime was driven by other factors, and they include higher productivity growth; improvement in the road network; increase in agricultural exports; higher overall budgetary expenditure on agriculture and allied activities, particularly by the state governmentsand targeting of fertiliser subsidy.It seems the lower growth of MSP and agricultural credit during the NDA-II regime was compensated by these other supportive measures.
    Keywords: Agriculture, Comparative analysis, NDA, UPA
    Date: 2019–04
  2. By: John T. Saunders (Lincoln University); Marcel Adenauer (OECD); Jonathan Brooks (OECD)
    Abstract: The Long-term Agricultural Outlook model (LAO) is a long-run partial equilibrium trade model developed by the OECD as a complementary modelling tool to AGLINK-COSIMO, a more detailed partial equilibrium model used to develop ten-year projections for agricultural markets, as reported in the annual OECD-FAO Agriculture Outlook publication. LAO describes the drivers of structural changes in global supply and demand, provides a baseline of real agricultural prices, and can be used to situate short and medium term price projections in a longer-term context. The model is also suitable for performing scenario analysis of long-term issues concerning agriculture, such as the links between food security and climate change. The model structure is similar to that of AGLINK-COSIMO, which enhances comparability, but much simpler, with highly aggregated commodity and regional groupings. The simplified structure makes it possible to make use of data on productivity growth in a way not possible in more complex models, and to investigate the role of long term drivers of productivity growth, in particular research spending. It also facilitates a focus on key macro-economic drivers of agricultural market developments. This report details the motivation, structure, and development of the model, alongside initial outputs. The baseline results indicate a lowering of real agricultural prices in the long run, as growth in global supply outpaces growth in global demand.
    Keywords: agricultural prices, agricultural productivity, climate change, food security, long-run analysis, partial equilibrium, total factor productivity, trade modelling
    JEL: C6 C69 F1
    Date: 2019–07–10
  3. By: Fleming, David; Kerr, Suzi; Lou, Edmund
    Abstract: Using the New Zealand Monitor Farm Data (NZMFD), this paper explores the cost-effectiveness of two mitigation options to reduce biological greenhouse gas (GHG) emissions on farms: reducing stocking rate (SR; the number of cows per effective hectare of dairy land); and increasing animal performance (AP; measured by production of milk solids (MS) per cow). These mitigation options have been defined as “no cost” because, if applied together, they could reduce the carbon footprint of farms while also maintaining or even improving profits (de Klein & Dynes, 2017). We evaluate the effect of these mitigation options on three main variables: milk profitability of the farm (cash operating surplus (COS)/ton of MS produced); emissions intensity (ton CO2eq/ton of MS produced); and the value of emissions (COS/ton CO2eq). The paper has two main findings: high-AP farms show significantly lower emissions intensities and higher milk profitability; and higher SRs on farms are significantly associated with lower emissions intensities while not being significantly associated with milk profitability or negatively associated with profit per hectare. These results imply that higher levels of AP reduce the GHG intensity of the farm and increase profit – a “no-cost” option – but unless either the SR or the area under dairy farming fall, an increase in AP will lead to an increase in absolute emissions. However, our results cast doubt on the idea that reducing SR is a no-cost way to achieve absolute emission reductions. The two options do seem to constitute a no-cost outcome when combined, but potentially the same mitigation could be achieved with lower loss of profit by reducing the area of dairy land while maintaining high SRs and increasing the performance of the animals.
    Keywords: Agricultural and Food Policy, Environmental Economics and Policy
    Date: 2019–05
  4. By: Brown, Jason (Federal Reserve Bank of Kansas City); Tousey, Colton (Federal Reserve Bank of Kansas City)
    Abstract: Using a vector autoregression that allows for time-varying parameters and stochastic volatility, we show that U.S. core inflation became 75 percent less responsive to shocks in food prices since the late 1970s. The decline in the pass-through of food price shocks to inflation is a result of a decline in both volatility and the persistence of food price changes in inflation. This decline in pass-through coincides with a period of increasing concentration in the food supply chain, especially among U.S. grocery retailers and distributors. We find that 60 percent of the variation in pass-through over the last four decades can be explained by changes in food retailers’ and distributors’ market concentration. Controlling for the composition of the food basket and inflation expectations explains an additional 20 percent of the variation. {{p}} Our results suggest that if the market concentration of food retailers and distributors continues to increase and inflation expectations remain well-anchored, the pass-through of food price shocks to inflation will likely remain subdued.
    Keywords: Food Prices; Inflation; Time-varying Parameters
    JEL: E30 E31 E52 Q11
    Date: 2019–06–13
  5. By: Christophe Muller (AMU - Aix Marseille Université); Nouréini Sayouti (CERDI - Centre d'Études et de Recherches sur le Développement International - Clermont Auvergne - UCA - Université Clermont Auvergne - CNRS - Centre National de la Recherche Scientifique, PASEL - Projet d’appui au secteur de l’élevage)
    Abstract: We investigate the causal mechanisms underlying the effect of agricultural policies directed toward pastoralist households in Niger on their dietary intake. To do so, we conduct a causal mediation analysis while referring to theoretical agricultural household models. The presumed mediator of interest is the annual profit from pastoral activities. We decompose the total effect of selected policies on pastoralist dietary intake into an indirect effect, i.e., the effect that operates through profits, and a residual direct effect. Using an agro-pastoral survey conducted in Niger in 2016, the effects of extension services associated with better access to markets are found to be channeled through households' annual profits from cattle and sheep raising, while this is not the case for private veterinary services and low-cost livestock feed programs. Extension services may foster specialization in cattle and sheep raising, which may incentivize households to move toward a nomadic lifestyle and change their food habits and thereby have detrimental consequences on their calorie intake. Besides, other life choices could be spurred or hampered by policies, such as migrations and radicalization.
    Keywords: Agro-pastoral policies,Mediation analysis,Agricultural household models,Niger
    Date: 2019–06–11
  6. By: Joseph I. Uduji (University of Nigeria, Nsukka, Nigeria); Elda N. Okolo-Obasi (University of Nigeria, Nsukka, Nigeria); Simplice A. Asongu (Yaoundé, Cameroon)
    Abstract: Low productivity among female farmers when compared with their male counterparts is considered an outcome of limited access to agricultural land and inputs. The objective of this investigation was to assess the impact of multinational oil companies’ (MOCs’) CSR on rural women access to modern agricultural inputs in the Niger Delta, Nigeria. A total of 700 rural female farmers were sampled across the region. Results from the use of a logit model indicated that CSR recorded significant success in agricultural development generally, but has undermined equality. This implies that if a woman’s agricultural productivity is continuously hindered by unequal access to agricultural resources (or opportunities) and widespread inequality will limit poverty reduction efforts in Nigeria. The results also showed that women depended on CSR of MOCs for policy dialogue and advocacy for women’s access to agricultural land and inputs. Supporting agricultural initiatives that focus on empowering women would boost food security in sub-Saharan Africa.
    Keywords: gender equality; agriculture; corporate social responsibility; multinational oil companies; logit model; Nigeria
    JEL: J43 O40 O55 Q10
    Date: 2019–01
  7. By: Masasi, Blessing; Ng’ombe, John N.
    Abstract: Smallholder irrigation schemes potentially improve the livelihoods of rural communities in developing countries. However, they face challenges such as infrastructural decline, lack of funding, lack of markets, shortage of water, underutilization of land, and inefficient irrigation systems. In Zimbabwe, the government carried out rehabilitation programs to address these problems but the performance of smallholder irrigation schemes remained poor. These chronic challenges triggered experts to adopt a market systems approach (MSA) to revitalize failing irrigation schemes. Using primary and secondary data sources collected in 2015, this study used a “before” and “after” descriptive assessment approach to determine the effectiveness of the MSA at revitalizing smallholder irrigation schemes in Zimbabwe. We used Mutema Irrigation Scheme as a case study. Results suggest that the MSA leads to improved efficiency of irrigation infrastructure, farm gross margins, willingness to pay irrigation fees and farmers’ standard of living. While this research does not econometrically establish causation of relations between variables involved, our results provide a foundation for future research on the application of the MSA to revitalize underperforming smallholder irrigation schemes in developing countries.
    Keywords: market systems approach; smallholder irrigation schemes; revitalization; Zimbabwe
    JEL: Q1
    Date: 2019–02–14
  8. By: Mohammad Reza Farzanegan (Philipps-Universitaet Marburg); Mehdi Feizi (Ferdowsi University of Mashhad); Hassan F. Gholipour (Swinburne University of Technology)
    Abstract: This study demonstrates an economic consequence of climate change and water crises in Iran. It examines the effect of drought on housing prices, residential land prices, and housing rents in Iran. Using data from provinces of Iran from 1993 to 2015 and applying static and dynamic panel fixed effects estimators, we find evidence that an increase in the balance of water (reducing the severity of drought) within provinces has a positive effect on property prices. Our results have important implications for Iranian policymakers and property investors.
    Keywords: Drought; Water Crisis; Property Prices; Housing; Iran
    JEL: R21 R31 Q54
    Date: 2019
  9. By: Berry, Sara S.
    Abstract: Using case studies drawn from the authors' own and others' research, this working paper describes and compares some of the ways land conflicts reflected, intensified or reshaped struggles over authority within and between families, local communities, institutions and states in post-colonial Africa. In the past, many Africans gained access to land through membership in a social group, rather than freehold ownership. In recent decades, with rising demand for land, urgent questions arose about land tenure and debates over land transactions often turned on issues of authority. Who was entitled to sell, lease, mortgage or bequeath land or land use rights to others, and who could decide? Coinciding with Africans' struggles to work out the conditions of their own self-government following the end of colonial rule, rising competition over land intersected with conflicts over authority and obligation at all levels of social interaction. This essay will focus on processes of 'privatisation from below', asking how smaller-scale commercial acquisitions figure as sources of wealth and/or threats to livelihood in different economic and political contexts
    Keywords: land ownership,land rights,social relations,authority,Landbesitz,Landrechte,soziale Beziehungen,Autorität
    Date: 2018
  10. By: Grilli, Gianluca; Curtis, John; Hynes, Stephen; O'Reilly, Paul
    Date: 2018
  11. By: Hendy, Jo; Ausseil, Anne-Gaelle; Bain, Isaac; Blanc, Elodie; Fleming, David; Gibbs, Joel; Hall, Alistar; Herzig, Alexander; Kavanagh, Patrick; Kerr, Suzi; Leining, Catherine; Leroy, Laetitia; Lou, Edmund; Monge, Juan; Reisinger, Andy; Risk, Jim; Soliman, Tarek; Stroombergen, Adolf; Timar, Levente; van der Weerdan, Tomy; White, Dominic; Zammit, Christian
    Abstract: New Zealand faces the challenge of using our land in ways that are not only resilient to future pressures and sustain our rural communities but also enhance our natural environment. For the public and private sectors to make robust land-use decisions under uncertainty, high-quality modelling tools and data are essential. The drivers of land-use decisions are complex and models provide a structured methodology for investigating these. While New Zealand is fortunate to have a range of different modelling tools, these have historically been used in a sporadic and ad hoc way, and underlying datasets are deficient in some areas. As the foundation for more strategic development of New Zealand’s modelling capability, this paper profiles the main land-sector and farm- and production-related models and datasets currently applied in New Zealand. It also explores priority policy areas where modelling is needed, such as achieving emission reduction targets; managing freshwater, biodiversity and soil quality; and understanding the distributional impacts of policy options as well as climate change. New Zealand’s modelling capability could be strengthened by collecting and sharing land-use data more effectively; building understanding of underlying relationships informed by primary research; creating more collaborative and transparent processes for applying common datasets, scenarios and assumptions, and conducting peer review; and conducting more integrated modelling across environmental issues. These improvements will require strategic policies and processes for refining model development, providing increased, predictable and sustained funding for modelling activity and underlying data collection and primary research, and strengthening networks across modellers inside and outside of government.
    Keywords: Land Economics/Use
    Date: 2018–11
  12. By: Debela, Bethelhem Legesse; Gehrke, Esther; Qaim, Matin
    Abstract: Child undernutrition remains a widespread problem in many developing countries. The empowerment of women, and mothers in particular, was shown to improve child nutrition in various geographical contexts. One important avenue to empower women is fostering female employment. However, maternal employment can influence child nutrition through different mechanisms; it is not clear under what conditions the overall effect will be positive. We develop a theoretical model to show that maternal employment can affect child nutrition through changes in (i) income, (ii) intra-household bargaining power, and (iii) time available for childcare. The links are empirically analyzed using panel data from rural Tanzania and regression models with maternal fixed effects. Maternal employment has non-linear effects on child height-for-age z-scores (HAZ), the standard indicator of longterm child nutritional status. Off-farm employment reduces child HAZ at low levels of labor supply. The effect turns positive at higher levels of off-farm labor supply and negative again at very high levels. The child nutrition effects of maternal time allocation to agricultural work on the own family farm are weaker than those of off-farm employment and statistically insignificant. These findings can help to better design development interventions that foster synergies and avoid potential tradeoffs between female empowerment and child nutrition goals.
    Keywords: Community/Rural/Urban Development, Food Consumption/Nutrition/Food Safety, Food Security and Poverty, Health Economics and Policy, International Development, Labor and Human Capital
    Date: 2019–07
  13. By: Wenting Wang; Longbao Wei
    Abstract: As the world’s largest importer of agricultural commodities, China’s agricultural policies have significant implications for the world agricultural market. For the first time, we develop an aggregate structural econometric model of China’s soybean market with linkage to the rest of the world to analyze the worldwide impacts of China’s soybean price support policies from 2008 to 2016. We investigate the impacts of China’s policies on the variability of their domestic and world prices, and adopt a Monte Carlo simulation to evaluate the distributional and aggregate welfare effects. Results indicate that (a) China’s soybean price support policies play an effective role in stabilizing their domestic price, while its increasing imports absorb world production surplus and reduce world price swings; (b) China’s producers gain at the expense of consumers and budgetary costs, and the net welfare change in their domestic market is negative; (c) Soybean exporting countries experience considerable welfare gains, and the world net welfare change is positive. Our findings provide new insights for future trade negotiations and agricultural market reforms in developing countries.
    Date: 2019–07
  14. By: Kopp, Thomas; Dalheimer, Bernhard; Alamsyah, Zulkifli; Yanita, Mirawati; Brümmer, Bernhard
    Abstract: Abstract: In contrast to the trend of a generally increasing liberalization of markets, agriculture remains one of the most protected sectors. In globally distributed production networks the effects of sector specific policies may spill over to other sectors and other countries. While the effects of these policy spill-overs are likely to be substantial, both conceptual and empirical work is surprisingly limited in the literature. This paper suggests an extension of the Gardner Model by two policy interventions to theoretically predict effects of exogenous policy shocks in one input market on price relations towards its substitutes. The economic model is then applied to the markets for natural and synthetic rubber which is an insightful example because the natural rubber market has been dominated by three big exporters who have collectively introduced policies to gain price control for decades. Results of a vector error correction analysis indicate that prices of natural rubber, synthetic rubber and crude oil are cointegrated. Both policies under consideration {an export tax and several measures to restrict supply} partly detached the natural from the synthetic rubber price in international markets. However, one of the policy measures might have produced effects detrimental to the intended targets.
    Keywords: Price Transmission Analysis,VECM,Tripartite Rubber Council,Indonesia,Thailand,Malaysia,Policy Interventions
    Date: 2019

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